Mercosur

Mercosur or Mercosul (Spanish: Mercado Común del Sur, Portuguese: Mercado Comum do Sul, English: Southern Common Market) is a trading zone among Brazil, Argentina, Uruguay and Paraguay. Its purpose is to promote free trade and movement of goods and peoples, skills and money, between these countries. Bolivia and Chile have associate member status. Chile is in the process of acquiring full membership after resolving minor territorial disputes with Argentina. Other Latin American nations are seeking to join.

Many South Americans see Mercosur as a useful bulwark against the encroachment of the United States in the region, either in the form of the Free Trade Area of the Americas (FTAA) or in the form of bilateral treaties. But Mercosur was signficantly weakened by the collapse of the Argentine economy in 2002, and indeed some critics believe the refusal of the Bush administration to bail out Argentina was based on its desire to undermine Mercosur, which it saw as a threat to its divide-and-conquer strategy for maintaining its dominance over the economies of Latin America.

Negotations to grant full membership to Mexico are scheduled to start on July 2004.

See also: trade bloc